The first 3 columns of the following table show data for a representative firm in an industry.The last 3 columns show the market demand and supply for the type of labour employed by this firm.

-What is the ultimate determinant of the real wage in Canada?
A)The level of taxation by all levels of government.
B)The value of the Canadian dollar.
C)The real output of goods and service in Canada divided by the labour force.
D)The number of Canadians actively participating in the labour force.

Question

The first 3 columns of the following table show data for a representative firm in an industry.The last 3 columns show the market demand and supply for the type of labour employed by this firm.
 
-What is the ultimate determinant of the real wage in Canada?
A)The level of taxation by all levels of government. 
B)The value of the Canadian dollar. 
C)The real output of goods and service in Canada divided by the labour force. 
D)The number of Canadians actively participating in the labour force.

Quizplus · Accepted Answer

The real wage in Canada is ultimately determined by the real output of goods and services divided by the labour force. This is because the real wage is essentially the purchasing power of the wage, which is determined by the productivity of the labor force, as measured by the real output of goods and services, and the size of the labor force. While taxation, the value of the Canadian dollar, and the number of Canadians in the labor force can all influence the real wage to some extent, they are not the ultimate determinants of the real wage.

The First 3 Columns of the Following Table Show Data